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Iran, South Korea seal €5bn pact

Iran said on Sunday that it had signed a basic agreement with South Korea to attract funds worth a total value of €5 billion for its development projects, Press TV reported.

The agreement was signed between Iran's Finance Minister Ali Tayyeb-Nia and the visiting South Korean Minister of Trade, Industry and Energy Joo Hyung-hwan.

Tayyeb-Nia told reporters that similar agreements have been previously signed with South Korea including one with the country's Exim Bank to provide a total of €8 billion to Iran to implement its development projects.

The Iranian minister further emphasized that South Korea is expected to provide Iran with loans worth a total of $15 billion based on the agreements that have been sealed so far.

Tayyeb-Nia also said Minister Joo had told him that South Korean wants to invest in Iran's auto industry as well as its tourism sector and its oil and gas projects.

In a separate development, Valiollah Seif, the governor of the Central Bank of Iran (CBI), has been quoted by the media as saying that Iran and South Korea have agreed to create a joint bank account to settle the outstanding payments for Iran's oil sales to South Korea.

Seif said the agreement was reached during a meeting with South Korea's Minister of Trade, Industry and Energy Joo.

The joint account, he added, will be created in the central banks of the two countries.

South Korea is a key trade partner of Iran in Asia. Seoul imports as much as 10 percent of its required oil supplies from Iran.

The current volume of trade between the two countries stands at around $9 billion which is expected to be increased to well above $10 billion in the near future.